Families don’t understand age limits of BC Training and Education Savings Grant
Aug 31, 2017
Knowledge First Financial says families don’t understand age limits of BC Training and Education Savings Grant
Some BC families may be leaving money on the table
MISSISSAUGA, ON, Aug. 28, 2017 /CNW/ - A majority of BC families are taking advantage of available RESP grants, according to a new Ipsos poll conducted on behalf of Knowledge First Financial. In total, 54% of BC parents report taking advantage of one or more government grants within a Registered Education Savings Plan (RESP), and there is reason to believe these figures may improve further with the recent introduction of the British Columbia Training and Education Savings Grant (BCTESG).
One in five BC parents with children 13 or under report taking advantage of the provincial grant, first introduced in 2015. However, there remains a significant knowledge gap in the public's understanding of the terms and conditions associated with the new grant, as four in ten (37%) BC parents said they were not aware the grant can only be claimed between the child's 6th and 9th birthdays. As a result, some eligible families may unknowingly leave $1,200 in provincial funding on the table.
"There is a significant opportunity for parents living in British Columbia to boost savings towards their child's future education costs through the provincial grant. When this is combined with the federal matching grant, it equates to thousands of dollars in RESP money," said Lesley-Anne Scorgie, personal finance expert and bestselling author. "Parents need to be aware of the age restrictions for the provincial grant so that these important application deadlines are not missed. Education is one of the greatest gifts you can give your children so I encourage BC parents not to leave money on the table when it comes to their child's RESP."
The British Columbia Training and Education Savings Grant is designed to encourage families to start saving early for their child's post-secondary education by offering a one-time grant of $1,200 to be held within a RESP. The grant is unique among provincial offerings by requiring no matching contribution from the family, but it can only be claimed between the child's 6th and 9th birthdays. Our survey found 21% of BC parents did not start saving for post-secondary education until their child was 10 or older.
"For families in British Columbia, the benefits of saving early for post-secondary education are clear," said George Hopkinson, President & CEO, Knowledge First Financial Inc. "Our RESP specialists are experts in helping families take advantage of the British Columbia Training and Education Savings Grant and other government incentives to make saving for education easier."
In contrast to the approach taken in British Columbia, other Canadian provinces with RESP grants currently match 10% of plan contributions, up to a maximum of $2,500 in contributions each year. The approach in other provinces allows families who start saving later to take advantage of government incentives. When asked whether they would prefer the current British Columbia Training and Education Savings Grant or a grant program similar to those offered in Saskatchewan and Quebec, 66% of BC parents preferred the latter option. Support for the current BC grant was substantially lower among those parents who started saving for their child's education after the age of 10.
These are some of the findings of an Ipsos poll conducted between August 3 and 15, 2017, on behalf of Knowledge First Financial. For this survey, a sample of 1,919 Canadian parents from Ipsos' online panel was interviewed online. Weighting was then employed to balance demographics to ensure that the sample's composition reflects that of the adult population according to Census data and to provide results intended to approximate the sample universe. The precision of Ipsos online polls is measured using a credibility interval. In this case, the poll is accurate to within ±2.6 percentage points, 19 times out of 20, had all Canadian parents been polled. The credibility interval will be wider among subsets of the population. All sample surveys and polls may be subject to other sources of error, including, but not limited to coverage error, and measurement error.
About Knowledge First Financial
Canadian families have relied on education savings plans offered by Knowledge First Financial for more than 50 years. Today, the company manages $3.72 billion in assets on behalf of more than 250,000 customers. Since 1965, payments from the plans have reached $3.9 billion and the Knowledge First Foundation has further enhanced Education Assistance Payments to students by nearly $50 million. As part of its commitment to helping Canadian families make the most of their education savings, Knowledge First Financial offers all available education savings grants and was one of the first RESP providers who was able to offer the BCTESG.
Knowledge First Financial Inc. is a wholly-owned subsidiary of the Foundation and is the investment fund manager, administrator and distributor of Registered Education Savings Plans. Knowledge First Foundation is a not-for-profit Canadian corporation with no share capital. The Foundation is therefore able to reinvest excess revenues in initiatives that support student success